Tobias Reisch (CSH, MUW) will present an online talk within the seminar “Analysis of Complex Systems” on July 02, 2021, 3PM-4PM (CET) via Zoom.
If you would like to attend, please email email@example.com
Title: “Inferring Economic Systemic Risk from Mobile Phone Data”
The underlying structure of an economy is the network of customer-supplier relationships. Economic shocks are propagated as demand-side shocks from buyers to suppliers or as supply-side shocks from supplier to buyer. Mostly due to a lack of appropriately granular data, input-output analysis is typically focusing on sector level economic shocks and shock propagation. Only recently has data on firm-level trade relationships become accessible – restricted, however, to a small number of countries, such as Japan, Belgium, Brasil and Hungary. Typically, this data is hard to obtain through extensive surveys, tax or payment system data. Here we present telecommunication data as an inexpensive and alternative way to get a good estimate of the national customer-supplier network of an entire nation that can capture international links of firms and is available in almost real-time, two novelties in research.
Through cooperation with an Austrian mobile phone operator, we are able to analyse mobile phone communication metadata between anonymized companies. We compare the communication links with a survey on critical suppliers conducted in April 2020. From this we calculate the probability of correctly identifying a customer-supplier relationship given a communication link. The probability rises with the intensity of the communication to values above 90%. Using additional external information we estimate quantity and direction of the flow of goods and calculate the systemic risk of individual firms. We calculate an Economic Systemic Risk Indicator for a firm as the fraction of the economy that is potentially subject to cascading effects subsequent to the default of said firm. We investigate the limitations and effects of our assumptions by simulations and outline future research directions. Our study presents a successful proof-of-principle of using the firm communication network as a proxy for the supply network. We expect our results to be the starting point of more detailed analyses of the multilayer-interaction-network of firms.